The cost of future electricity is an important factor when deciding whether to go solar, but it is also one of uncertainty. Historic utility price data is a good indicator of future trends, but no one can predict what the future will bring. With current government incentives to purchase solar power systems, homeowners might not find a better time than now to switch over to clean solar energy. According to the U.S. Energy Information Administration, electricity prices have increased 1.8% every year for the past twenty five years, if you go back to 1960, the average annual cost increase is 2.8%.
According to a state-by-state breakdown of electricity costs recently provided by SolarReview, the five states with the largest electricity price increases over the past 25 years were Hawaii, Oregon, Alaska, Wisconsin and Massachusetts, with rate increases between 2.76% and 3.86%.
Dominion Energy (Virginia’s leading utility) states that prices will continue to rise by at least 3% each year in the coming years. It’s no surprise that energy companies have always used the cheapest (and often the dirtiest) sources of energy generation, but that trend will be diminishing as governments specify climate goals which will raise inflation even more. In Virginia and many other states, goals to source 100% of power from renewables are set for 2050. In order to achieve these targets massive investment and development costs will be taken on by utilities, and ultimately passed to homeowners.
So even though no one knows by how much, the cost of energy is going up, and with the record low cost to go solar, now may be the best time to invest in clean energy for your home.